For a lot of people, who needs credit counseling can be an odd and mysterious subject. Sometimes it’s lost in the broad world of banking, hidden behind self-help apps or products along with services, and sometimes it’s even cloaked by bigger problems with debt settlement. It can be important – but every once in a while it falls under a certain sort of stigma. “Who needs credit counseling?” you imagine someone asking — “Only people who need help with their finances.”
You might see it as some kind of negative stigma – but it’s there for a reason. It might not be for you, but it’s time to look over everything and find out if it is good for you.
While there are good reasons for consumers to avoid counseling agencies, the problem becomes when people avoid counsel even when they need it or it could help them. Some people have become suspicious of the idea – but legitimate credit counseling has nothing to do with the usual concerns of money. Asking a reputable credit counsel might be what you need to get on your feet.
Remember: credit counseling is not debt settlement or repayment or anything else. Credit counseling is an entirely different thing – it lets you slowly repay, which may help out your credit score, and does it with terms which let you save over time rather than break the bank.
Find a Legitimate Agency
As always: be careful. Look around for NFCC-certified agencies – those are the kind that will actually help you out, while others might be unreliable, untrustworthy, or even predatory – none of which are things that you want! Remember that your initial session should not be charged: it’s a free consultation.
What do Credit Counselors Actually Do?
What credit counselors do – beyond ‘help with credit debt’ – is to act as a mediator for you in the middle of your creditors. You might see fees waived out of the way, interest rates lowered and other benefits that help you pay for a month or ensure you can still put some food on the table without struggling too much.
Don’t Worry Too Much!
Some others might be worried about actually asking for help – who needs credit counseling? I don’t! I can do it on my own! – and the good news is that a good credit counseling agency agrees with that. They want you to do it yourself – and they’ll tell you honestly if you can.
Some others might not want to go to a credit counseling agency because they feel shameful about it – but that’s not a concern for multiple reasons. First off, any good counseling agency makes privacy a top concern – that’s right. There’s no chance of it getting out. Even if it did, you shouldn’t be ashamed of having to ask for help.
Countless millions of people are in bad financial straits at the moment, and the economy is limping along – needing a little bit of help now is better than digging a deep hole for yourself as time goes on.
So -Who Needs Credit Counseling?
If you have a debt-to-income ratio (short as a DTI) that’s higher than 15%, you might want to give credit counseling a look. At the very worst, they say that you’re fine and don’t need the help – and at no cost to you! Always remember that initial session is free, so you won’t be charged for those first few questions.
Also look at your life and financial situation. Are you going through some serious hardship right now? Is debt piling up or are there some other problems? If…
- your income has been reduced
- you’re an excessive spender
- your expenses have climbed up
- you’ve recently become unemployed
- or if you’re going through a separation,
You might benefit from credit counseling – even just that initial consultation. They’re even ready to help you with piling medical bills and credit debt, so don’t be afraid to ask around.
Take a look at your score for credit – and before you leap at the opportunity of getting a better score, remember! Credit counseling is not a magical fix-all, and it won’t guarantee an immediate increase on your score; but you might find that hiring a credit counseling agency will cause you to make your payments in full and on time, which means that your score might – incidentally – increase. Always remember that it is still about what you do once you decide that you’re someone who needs credit counseling.
Credit counseling isn’t for everyone – but it can help you out. It’s preferable to bankruptcy and it can keep you steady until you’ve gotten into a better situation in life – and in the long term it can save you money with lowered fees or rates that lead to a higher quality of life. Don’t think about any kind of stigma, and don’t be so vain as to think you can’t accept exterior help – if you’re undergoing some financial hardship, at least give the idea a looking at, and consider that free first session to see exactly where you stand from the point of view of someone who knows credit.